HDFC Bank Q4 Update: Advances Cross ₹29 Lakh Crore, Deposits Grow 14%

Introduction to Q4 Performance

HDFC Bank Ltd, India's largest private sector lender, has released its provisional business update for the fourth quarter ending March 31, 2026. The bank reported sustained double-digit growth in both advances and deposits, signaling a steady operational performance ahead of its detailed financial results. The figures, disclosed in a regulatory filing, highlight the bank's continued focus on strengthening its balance sheet post the merger with HDFC Ltd.

Robust Growth in Advances

The bank's gross advances aggregated to approximately ₹29.60 lakh crore as of March 31, 2026. This represents a significant 12% year-on-year (YoY) increase compared to the ₹26.43 lakh crore recorded on March 31, 2025. This growth indicates healthy credit demand and the bank's ability to expand its loan book. On a quarterly average basis, advances under management stood at ₹29.64 lakh crore, marking a growth of around 10% over the corresponding period in the previous year. The consistent expansion in the loan portfolio underscores the bank's market leadership and its role in financing economic activity.

Deposit Mobilisation Remains a Key Strength

HDFC Bank's deposit base showed even stronger growth, a key strategic priority for the lender. Period-end deposits reached approximately ₹31.05 lakh crore as of March 31, 2026, a robust growth of 14.4% year-on-year. This strong performance in deposit collection is crucial as it helps the bank manage its credit-deposit (CD) ratio, which had risen following the merger. A healthy deposit franchise provides a stable and low-cost source of funding, which is essential for maintaining net interest margins and ensuring long-term profitability.

Strategic Context: Post-Merger Consolidation

The latest quarterly figures should be viewed in the context of HDFC Bank's overarching post-merger strategy. Since the integration with HDFC Ltd., the management has been vocal about its intention to moderate loan growth to align it more closely with deposit growth. The primary objective has been to bring down the elevated CD ratio to a more sustainable level. The Q4 update suggests that this strategy is bearing fruit, with deposit growth outpacing the growth in advances. This disciplined approach is aimed at building a more resilient balance sheet for future growth phases.

Key Financial Metrics Summary

The provisional numbers provide a clear snapshot of the bank's operational scale at the end of the fiscal year. The data points towards a solid end to FY26.

Analyst Expectations for Full Results

Ahead of this business update, several brokerage firms had released their preview notes for HDFC Bank's upcoming Q4 results. Motilal Oswal Financial Services (MOFSL) expects the bank to report a 9% YoY rise in net profit to ₹19,198 crore on a 5% rise in Net Interest Income (NII) to ₹33,661 crore. They anticipate a flat Net Interest Margin (NIM), retaining a 'Buy' rating on the stock.

Similarly, YES Securities projected a 5.8% YoY increase in net profit to ₹18,640 crore and a 5.5% rise in NII to ₹33,834 crore. The brokerage noted that sequential loan growth would likely be around 3.5%, with NII growth slightly outpacing it. These estimates suggest that the market anticipates a steady, albeit not spectacular, quarter in terms of profitability.

Market Outlook and Forward Guidance

The provisional numbers are likely to be received positively by the market, as the strong deposit growth addresses a key investor concern from previous quarters. The double-digit loan growth, while a moderation from historical levels, is in line with the bank's stated strategy and reflects a prudent approach to expansion. The bank's management has previously guided that it aims to match the system-wide loan growth in FY26 and aims to surpass it from FY27 onwards. This update indicates the bank is on track to meet its near-term objectives.

Looking Ahead to April 18

It is important to note that the figures released are provisional and subject to audit. HDFC Bank is scheduled to announce its detailed audited financial results for the fourth quarter and the full financial year 2025-26 on April 18, 2026. The full results will provide a comprehensive picture of the bank's performance, including critical metrics such as net profit, net interest margin, asset quality (Gross and Net NPAs), and other operational efficiencies.

Conclusion

HDFC Bank's Q4 FY26 business update demonstrates a successful execution of its post-merger strategy, emphasizing balanced and sustainable growth. The strong momentum in deposit mobilisation combined with healthy, double-digit credit expansion positions the bank well for the upcoming fiscal year. Investors and analysts will now await the detailed financial results on April 18 for deeper insights into the bank's profitability and asset quality.